Portugal’s Finance Minister Joaquim Miranda Sarmento emphasized the government’s priority is national reconstruction following recent severe storms, while also maintaining fiscal balance. The minister’s comments approach as the country assesses the economic fallout from the widespread damage.
“It will still take a few weeks” to fully understand the impact, Miranda Sarmento said. “We require to understand how many companies will apply for layoffs and exemptions from social security contributions; how many people will be out of work and for how long, until companies are able to resume activity; and how many roads we have to repair, and to what extent.”
“I would say it will still be a few weeks before we have a clear idea of the total budgetary impact of these disasters,” he added.
Miranda Sarmento highlighted that the country achieved a strong budgetary result in 2025, with public debt falling below 90 percent, and “we will have a budgetary surplus that will be slightly above 0.3 percent.”
“These good budgetary results serve precisely so that the country, when it has this type of crisis, can respond in a more capable way without jeopardizing the balance of public accounts,” he stated.
“When we built the budget for 2026, the path was already narrow because of the PRR [Recovery and Resilience Plan] loans. The good results of 2025 and the fact that the budgetary balance was above what was forecast in the State Budget made the path a little less narrow,” but “the path has turn into much narrower again due to these storms, and that is the balance between choices that has to be made at every moment depending on the information available,” the minister added, speaking upon arrival at the meeting of finance ministers of the Eurozone in Brussels.
Despite the challenges, the minister admitted that “the path has become a little narrower again.” “We will do everything to maintain the balance of public accounts and the reduction of public debt.”
With the improvement in weather conditions, an assessment of the economic and budgetary impacts is underway, an evaluation to activate European emergency and disaster lines, a reprogramming of the PRR, and the launch of a new reconstruction program, which includes several funding mechanisms.
Assuring “several instruments and several sources of funding, we will not fail to act as quickly as possible in the reconstruction of these territories.”
“There is a budgetary impact to assess,” he repeated. “The balance between choices has to be made at every moment, depending on the information.”
